Case Studies

Cost Engineering Products to Meet Consumer Price Expectations

Christmas Tree Case Study


To ensure success in the holiday season, retailers must make effective pricing and assortment decisions at the beginning of the season, or else they might make huge financial mistakes that will bleed into the new year.

A home goods retailer was launching a new line of designer holiday trees. Their target customers liked the new 7.5' Snowy Flocked Tree – it earned 61% positive sentiment scores in pre-launch testing. Unfortunately, customers were not willing to pay the $200 planned ticket price. The predicted average selling price was only $143.


The product team designed and tested a 6.1' version of the same tree which they tested through First Insight's predictive analytics platform, hoping to reduce production and shipping costs while keeping in mind the customer's willingness to pay.   


The cost-engineered product appealed to consumers at a price they were willing to pay. The new line of designer trees achieved revenue and margin targets, allowing the retailer to create a successful product moving into the holiday season. 

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